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Boulder City council approves rebuild of Substation 3 after cost jumps to $10.85 million
Summary
Council approved an amended interlocal agreement to rebuild Substation 3 after utility directors reported transformer prices and lead times doubled earlier estimates; the project carries a new $10,850,000 price tag and a March 1, 2028 completion target and is expected to fit within the current utility rate study.
Boulder City Council on Jan. 14 approved an amended agreement with the Colorado River Commission to rebuild Substation 3 after city staff reported major increases in equipment pricing and manufacturing lead times.
"With accurate pricing data ... the new estimated project costs to complete the rebuild of Substation 3 is now $10,850,000 with a completion date of 03/01/2028," Utilities Director Joe Subitz told the council, noting that transformer pricing returned at about double earlier feeder‑project estimates.
The project is part of a long‑running plan to convert Boulder City’s distribution system from 4 kV to 12.5 kV, a change Subitz said will reduce energy losses, increase capacity and improve reliability. He said the city’s preliminary engineering estimate had been around $4.5 million but that the first set of vendor pricing — the substation transformers — came in at roughly twice that earlier estimate and now account for a large share of the total cost.
Subitz said procurement was run through the Colorado River Commission’s RFP process, which returned a competitive low bid. He told council that the commission was able to negotiate a no‑escalation price provision for the transformers, an important concession given current market volatility. He also said manufacturing lead times have lengthened, driving the schedule change.
Council members pressed on procurement, potential rate impacts and staging. Subitz said the rebuild and related scope reductions for other substations keep the project within the assumptions of the current utility rate study and — as presented — will not require an immediate rate increase. He said a new rate study will be needed for fiscal years 2027 and beyond.
Council praised staff for using the Colorado River Commission expertise; the council approved the resolution unanimously.
Next steps: staff will continue procurement through the interlocal mechanism with the Colorado River Commission, monitor lead times, and return to council as the project advances and as future rate‑study results become available.
